The Kellogg Co.

October 1, 2012
- by
Corporate Profiles

Share This:

By all accounts, Battle Creek, Mich.-based Kellogg Co. is best defined as being a global cereal and a U.S. snack company. In fact, that’s exactly how John Bryant, president and chief executive officer of Kellogg, described the company in early August. But a significant acquisition in 2012 — the May purchase of Pringles for $2.695 billion from Procter & Gamble Co. — has set the company up well to build a global snack business.

“The integration is progressing well,” Mr. Bryant said in August. “Just as a reminder, this was a carve-out, not a straight acquisition, and was far more complicated as a result. So we’re pleased the transition is going so smoothly.”

Mr. Bryant said Kellogg now has improved visibility into Pringles operations and expects ongoing annual synergies to be in the range of $50 million to $75 million. He noted that a lot of customers around the world have confidence in the brand and are optimistic regarding its potential.

Around the same time it was completing the Pringles acquisition, Kellogg was wrapping up a major brand overhaul that included a redesigned web site, a new tagline and a broad and unified approach to promoting the power of breakfast.

Kellogg’s new tagline is “Let’s Make Today Great,” which the company said reflects the reasons consumers worldwide choose Kellogg’s brands for the best start to their days. Previously, the tagline most associated with Kellogg was “The Best To You Each Morning...from Kellogg’s.”

Additionally, Kellogg is adopting distinctly bright visual graphics and images that better reflect company and consumer values of optimism, as well as a more conversational tone that supports the relationships consumers want to have with brands today, particularly in the social and digital worlds.

“While our master brand has tremendous resonance with consumers, we knew we had an opportunity to further invest in the Kellogg’s brand to strengthen our business and grow with our consumers,” said Kim Miller, senior vice-president of global brands at Kellogg. “By refreshing our brand in ways consumers will continue to relate to, we can build on current relationships and establish strong new ones for the future.”

Kellogg also this year unveiled a new “Heart Healthy Selection” logo on nine of its cereals, including a new cinnamon almond variety of Raisin Bran. The logo is featured on the front, bottom left hand corner of the cereal boxes and includes a red heart inside a green circle.

According to Kellogg, the cereals with the Heart Healthy Selection logo provide a good source of fiber, are low in fat, saturated fat and cholesterol, and provide many key nutrients that the body needs.

Financially, Kellogg remains upbeat about future prospects for the company despite a 7% decline in earnings for the six months ended June 30 to $659 million. Sales for the six months were $6,914 million, up slightly from $6,871 million.

The company said it expects full-year earnings per share to be in the range of $3.18 and $3.30 per share with internal net sales growth of 2% to 3%.

“We’ve taken significant actions in the first half of the year, and our second-quarter performance reflects some of the improvement that has resulted,” Mr. Bryant said. “This, and the inclusion of the Pringles business, has given us improved visibility in our outlook, and we remain optimistic regarding the significant, long-term potential of our businesses.